The Risks of Unfettered AI

UnfetteredAI

I have written before about the potential risks of machine learning when implemented in areas that impact on people’s daily lives. Much of this has been hypothetical, thinking through the possibilities of what “could” happen in the future if we go down various paths. This story is a little different as it is something that is actually happening at the moment.

Like many people I use various cloud software for different purposes. Most of these are paid for on a monthly subscription via credit card. One particular piece of software I use is from a major vendor that has more than 75,000 customers. I have used this software for a few years and have paid monthly via a credit card I have had from my bank (names not important).

Now 4 months ago, I got a text message at 2am from my bank saying that they had flagged a transaction as suspicious and that my card was temporarily blocked. It just so happened that I had a 3am meeting that day, so no long after getting the text I called the bank.  It turns out it was the payment for the software mentioned above, and the banks fraud detection system had flagged it as unusual for some reason. But no issue, the person on the phone quickly ok’d the transaction and re-enabled the card, so no harm and I could use my card as normal again.

However, a month later I again received the SMS from the bank. And again I called, again they explained it was this transaction and again they resolved. I explained that this had also happened the month before and I was provided assurances that this was now resolved. Business as usual again.

Now fast forward to the same time last month. But this time no notification from the bank. Instead I started getting messages from other providers saying my payments to them had been declined. So I called the bank. Turns out, you guessed it, the same transaction had flagged again causing my card to be blocked, causing other payments to fail. This time I make a bit of a fuss and they provide more assurance that they had updated the notes in the system to say this was a valid transaction.

I am sure by now you can predict where this is heading, of course it happened again this month. I spoke to the credit card security department and while my card was again re-enabled I asked about the likelihood of this transaction causing my card to be blocked again next month. As it appears, while staff can add “notes” to the system, they do not seem to have any method to override the fraud detection system to ensure a valid transaction is not repeatedly flagged incorrectly.

Improved fraud detection is one of the commonly cited areas where machine learning is brining positive gains. These algorithms are “learning” their own patterns from historical of data, finding relationships much subtler than what was possible before when we had to manually coded rules. This tends to provide a higher level of accuracy overall in detecting potential fraud. I actually applaud banks efforts to continuously improve in this area, having a different credit card number stolen years ago has made me well aware of the extent of the problem they are trying to solve.

However, machine learning can be complex to debug or influence for individual error cases. Global rules are extracted by machine learning algorithms from millions or billions of rows of history and these learnings are what are used to make future predictions. Over time miss-classifications may feed back into the learning process as a form of continuous improvement, but this may take some time to occur, and unless the error rate is of high significance it may not actually change the prediction outcomes.

While as a whole you can achieve high levels of accuracy there will always be residual false-positives, where valid transactions are flagged incorrectly. So, what happens when one customer with one transaction is being classified incorrectly? Implementing machine learning systems with real world influence, without a “sanity” override can lead to undesired consequences. We have to remember errors will still occur no matter our accuracy and this needs to be managed. Secondary level assessment using more traditional, user-definable rules may be required to handle these errors to ensure systems are able to respond appropriately and quickly to individual cases of miss-classification.

However, for now I am now caught in the error percentages of a machine learning process. I have no way to make this valid payment without the associated card being blocked on each occurrence. Which means I either have to go through this process every month or look to move this payment to a card from another bank. 

Given the extent of credit card fraud, perhaps the misclassification of a small percentage of valid transactions is a tolerable impact, globally credit card fraud is a $16b problem which needs to be resolved. Of course, I would be unlikely to move bank because of an issue with a single transaction. However, if more transactions start to fail because of this limitation I wouldn’t have many other options as the system starts to impact and degrade the usability of the service that it was designed to protect.

This is of course still just an example. The point being, wherever we are using machine learning to make prediction we still need to acknowledge the prediction error rates and provide appropriate measures to limit the ongoing impact of these.

The opinions and positions expressed are my own and do not necessarily reflect those of my employer.

Author: Tony Bain

Tony has 20 years experience building software and services business using advanced analytics, collaboratively using computers to do what they do best and empowering people to do what they do best.

He is the co-founder of RockSolid SQL (now part of DXC Technology) and has grown the business to over 130 customers globally, and is also an adviser for LiquidityCube, one of the most exciting emerging fintech startups right now. Tony has written numerous books, articles and posts on data driven business and regularly presents at data focused conferences.

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